Since 1 April 2012 the normal time limit for an employer claiming an overpayment of PAYE income tax is four years from the end of the relevant tax period. The time limits for claiming an overpayment of NICs Class 1 and Incentive Payments is six years and Class 1A/B is seven years, as set out in the attached helpcard.

Where, as part of a compliance check, you identify omissions that give rise to liabilities that are recovered by Class 6 Contract Settlement, or Regulation 80 Determinations and / or Section 8 Decisions and you see there is an apparent overpayment on ETMP you should

Once the stencil is received in NIC&EO it will be passed to an authorising officer for them to check and send to DMB to repay or reallocate the overpayment.

If the Assurance team in NIC&EO find any problems with the P565 request they will contact the caseworker directly stating the reasons preventing them from processing the P565 request.

Note: Apparent overpayments on ETMP can arise for a number of reasons, for example

missing return or return parts

incorrect allocation in ETMP

mathematical errors in the return, or

more reasons are outlined in PAYE47060.

It is important when completing a P565 request stencil that you establish the reason for the apparent overpayment and confirm that the overpayment is justified and within the time limits. If this is not done the stencil will be returned to you because the repayment or set off would leave an underpayment on the employer record.

Further guidance relating to the completion of the P565 stencil can be found in the PAYE manual at PAYE47020 and PAYE47045. The link to the P565 stencil in the PAYE manual should not be used. Instead you should use the link at the top of this page which will take you to the Compliance version of the P565 stencil.

If you find there is insufficient space in the stencil to provide the information required in the ‘report of overpayment’ section then you should attach a Word document with the additional information.

When a set off against a charge is required, make a note in the special circumstances box on the P565 of either the date the set off was agreed or the date you are requesting the set off. DMB Banking using this information to calculate the EDP and RPI.

Common reasons for rejection of P565 stencils

There is no overpayment on the employer record. If you want to move money on ETMP but there is no overpayment you should send an Eform with full details of the reallocation to:

The request is to allocate money from the current year/current tax period to another year/tax period. Current tax periods do not have overpayments until the RTI returns are processed.

The overpayment relates to a ‘misallocated’ payment on the employer record, for example the employer did not make the payment. You should send an Eform with full details of the ‘misallocated’ payment to: